R7O - Approve Das Use Agreement, Waive Bid

Resolutions - R7 O

COMMISSION MEMORANDUM

RECOMMENDATION

The Administration recommends that the Mayor and Members of the City Commission approve the execution of the early termination of the current Use Agreement and enter into a new Use Agreement at the Miami Beach Convention Center.

BACKGROUND/HISTORY

The City of Miami Beach (the “City”) is the owner of the Miami Beach Convention Center and its related infrastructure, including a City-owned fiber optic network. To enhance wireless communications and coverage within the Convention Center, the City entered into a DAS Facility Use Agreement with Crown Castle Fiber, LLC. (“Licensee”), a Delaware limited liability company authorized to do business in Florida. The DAS Facility Use Agreement is for a term of nine (9) years and three hundred and sixty-four (364) days commenced on January 27, 2017, and expiring on January 25, 2027.

Under their current Agreement, Crown Castle Fiber, LLC. is licensed to install, operate, and maintain a wireless communication system commonly referred to as a Distributed Antenna System (DAS) to be made available to wireless carriers for the provision of telecommunications services throughout the Convention Center property, thereby supporting the City’s Primary Purpose while facilitating modern infrastructure development through a neutral-host system that minimizes visual impact and operational disruption.

In addition to the DAS Agreement, Crown Castle Fiber, LLC. also holds a separate Lease Agreement with the Miami Beach Redevelopment Agency (RDA) for the Anchor Shops and Garage, which is nearing its expiration. As a result of this upcoming expiration, Crown Castle Fiber, LLC. submitted a formal Letter of Request on February 20, 2025, attached hereto as Exhibit A, seeking the early termination of the current DAS Facility Use Agreement and the execution of a new DAS Agreement. The intent is for the new Agreement to run concurrently with the upcoming Agreement for the Anchor Shops and Garage. This request is intended to

streamline Crown Castle’s internal operations and renew their commitment to long-term infrastructure investment within the City. It also reflects the Licensee’s intention to remain in compliance with the City’s terms and maintain uninterrupted service at the Convention Center.

Below is a summary of the proposed new Use Agreement’s essentials terms and conditions:

Licensor:

City of Miami Beach

Licensee:

Crown Castle Fiber, LLC

Location:

Miami Beach Convention Center, Miami Beach, FL

Licensed Area:

Portions of the City’s structures, including buildings, light poles, and fiber networks, for the installation and operation of a Distributed Antenna System (DAS).

Use Agreement Duration:

9 years and 364 days starting from October 31, 2025 and expiring October 29, 2035

Use Fee:

Initial Fee: $25,000 (due within 30 days of the effective date). Recurring Fee: 25% of monthly gross receipts collected from wireless carriers. Carrier Fee: $25,000 per new Carrier Agreement (due within 30 days of execution).

Real Estate Taxes:

Any increase in real estate taxes due to the DAS installation must be reimbursed to the City.

Security Deposit:

No Security Deposit, however, a Performance Bond of $350,000 is required and currently in place.

Permitted Use:

Installation, operation, and maintenance of a small cell wireless communication system (DAS) to be licensed to wireless carriers.

Utilities & Maintenance:

Tenant is responsible for all installation, maintenance, and operation of its equipment. The City provides electrical power for DAS nodes up to 20 amps per node at no cost. Any excess usage is charged to the Tenant.

Sublicenses:

Crown Castle may sublicense to wireless carriers but must retain control over the system.

ANALYSIS

The proposed DAS Facility Use Agreement establishes a structured revenue-sharing model that supports the City’s long-term financial and technological goals. Under this agreement, Crown Castle will remit 25% of the monthly gross receipts collected from wireless carriers utilizing the DAS network, providing the City with a consistent revenue stream. The Gross Rent Payments for 2023 and 2024 were $121,827 and $123,705, respectively. This rental income for the City is projected to continue a 2% - 3% increase each year. Additionally, the agreement requires a one- time initial fee of $25,000, along with a $25,000 carrier fee per executed Carrier Agreement, further enhancing the City's financial benefits. This represents an additional $100,000.00 one- time, fee payment at execution of this new Agreement.

By leveraging wireless carrier participation, the DAS Facility Use Agreement is expected to generate substantial recurring revenue, with rent payments commencing immediately upon execution. This structure ensures a scalable income model while facilitating the expansion of wireless network coverage in a high-demand urban area.

The agreement also includes provisions for flexibility and property management, including a one- year notice requirement for termination and the City’s right to require equipment relocation, with all associated costs covered by the Tenant. This ensures that the City maintains control over its infrastructure while minimizing financial risks.

FINANCE AND ECOMONIC RESILIENCY COMMITTEE

This item was discussed at the June 4, 2025 Finance and Economic Resiliency Committee (FERC) meeting. The Committee recommended in favor of approving a new Use Agreement with Crown Castle Solutions LLC containing the terms and conditions outlined above.

FISCAL IMPACT STATEMENT

The proposed agreement is expected to generate ongoing revenue for the City through a combination of fixed fees and a revenue-sharing model based on 25% of Crown Castle’s gross receipts from wireless carrier agreements. Additional income will result from a one-time initial fee and career-specific fees. As rent is calculated as a percentage of gross receipts, total revenues will vary based on carrier participation and usage over time. The lease structure ensures that all installation, maintenance, and operational costs are fully covered by the Tenant, allowing the City to benefit from enhanced telecommunications infrastructure without incurring financial obligations.

Does this Ordinance require a Business Impact Estimate? (FOR ORDINANCES ONLY)

If applicable, the Business Impact Estimate (BIE) was published on: See BIE at: https://www.miamibeachfl.gov/city-hall/city-clerk/meeting-notices/

FINANCIAL INFORMATION

CONCLUSION

The City Manager recommends that the Mayor and Members of the City Commission waive, by 5/7 th vote, the formal competitive bidding requirement in Section 2-367(e) of the City Code, finding that such waiver is in the best interest of the City and approve in subtantial form, the new Use Agreement (“Agreement”) at the Miami Beach Convention Center, a draft copy of which is attached hereto as Exhibit “B”. This Agreement will ensure the continued operation of Crown Castle’s Distributed Antenna System (DAS), which enhances wireless coverage and supports the City’s commitment to modernized telecommunications infrastructure.

The proposed Agreement provides a stable and competitive revenue structure, utilizing a revenue-sharing model that guarantees a consistent financial return for the City. By fostering improved connectivity and infrastructure, the Agreement supports ongoing technological advancements, benefiting businesses, residents, and visitors by enhancing communication capabilities in a high-traffic area. Additionally, with Crown Castle Fiber, LLC. assuming full responsibility for all installation, maintenance, and operational costs, the Agreement ensures minimal financial risk to the City while maximizing long-term benefits.

Applicable Area

South Beach

Was this Agenda Item initially requested by a lobbyist which, as defined in Code Sec. 2-481, includes a principal engaged in lobbying? No

If so, specify the name of lobbyist(s) and principal(s):

Department

Facilities and Fleet Management

Sponsor(s)

Co-sponsor(s)

Condensed Title

NR- Accept Rec, New Use Agmt w/ Crowne Castle Fiber, LLC for DAS Facility Use Agreement. FF

Previous Action (For City Clerk Use Only)

Not reached on 7/23/2025 – R7 H